The Nihon Keizai newspaper reported Tuesday that Yahoo! Japan will offer ADSL (asymmetrical digital subscriber line) services at a fixed monthly charge of ¥2,000 (US$16.28) from August.
That is about half as expensive as Nippon Telegraph and Telephone's ADSL service. NTT, which launched its ADSL service in December, has 96,000 subscribers, or about half of the country's ADSL market.
Yahoo and Softbank will invest ¥100 billion (US$814 million) in infrastructure by year end.
Yahoo! Japan would not comment on the report but said it would announce details of the planned business Tuesday. Yahoo! Japan is owned by Internet investment company Softbank and Yahoo! US.
The new service could be what Japan needs to spark its broadband market, which has suffered due to lack of competition.